As the foundation for the investigation, Fishbein and Ajzen's theory of reasoned action from 1975 was used. The findings demonstrated that behavioral intention was strongly and favorably connected to attitude and subjective factors. All of these independent variables were able to account for 28% of the variation in a person's behavioral intention to pay GST. (9) GST is a potential method for raising the current tax rate and taking the place of the long-established service and sales taxes. But are all businesses, especially small and medium-sized ones, prepared to implement the technology effectively? How much would it cost them to comply, in terms of new software development, training for human resources, and accounting systems, if they were to adopt the system? (10) Beginning on April 1, 2015, the Malaysian government implemented the Goods and Services Tax (GST). It is critical to comprehend tax agents' impressions of their clients' compliance behavior one year after the GST was implemented. 30 registered tax agents in total responded to the poll.(11). A consumption tax known as GST is levied on the purchase of goods and services. Out of the 645,136 businesses, the majority—97.3%—are small and medium-sized enterprises. It makes for 36.6% of the GDP, 65.5% of the labor force, and 17.8% of trade exports. Small and medium sized businesses (SMEs) in Malaysia are heavily burdened by the cost of GST compliance. The production of batik contributes significantly to the economic growth of the nation by creating jobs and commercial opportunities. The purpose of this study is to analyze the impact of GSPs and compliance costs on batik makers' GST compliance. (12)
2.1 Theoretical Framework
Taxes are a mechanism for the government to raise money from people, businesses, and other organizations. Low turnover taxes will have an impact on the country's development because taxes are a factor in national development. Contributions made through tax revenues have taken on significance in light of Malaysia's condition. (13)
2.2 Attitude toward GST compliance
Attitude does not define any study. It is concerned with belief knowledge and awareness about goods and service tax. A person's attitude is their conviction that by acting in a given way, a particular consequence will occur. It is anticipated that the financial managers will have either a favorable or negative professional attitude toward the GST. Regarding self-brand connection and product participation, attitude is said to have some impact on business management. The organization and sponsorship fit. The attitudes of the customers and the ability to service are used to support and evaluate reputation. Essentially, this is done through corporate management actions. There are unquestionably situations in which attitude has no effect and fails to mediate the interaction. (14). Since the 1997 Asian Financial Crisis, Malaysia has never had a structural budget surplus. The Goods and Services Tax aims to improve the tax collection process. The cost of doing business is significantly more decreased by shifting the tax burden from producers to customers. (15).
H1- Attitude toward GST among manufacturer is positive in respect to to tax compliance.
2.3 Government incentive
Relative prices are changed in favor of paying taxes and against dodging them when taxpayers receive rewards for correctly carrying out their obligations. Two requirements must be satisfied for this outcome to occur: The income effect brought on by a higher wealth position must not be counterproductive to tax avoidance. According to the crowding hypothesis, the motivational impact of rewards on conduct extends beyond what is covered by conventional theory. Rewards tend to boost and improve tax morale to a greater extent when they are viewed as a reward for being a good taxpayer. The intrinsic drive to pay taxes may be weakened by deterrence, in contrast. The state should reward "good" taxpayers with access to public resources in a way that boosts tax morale more than financial rewards. Such a "gift" also highlights the reciprocal exchange relationships that exist between the taxpayer and the state (16). Angel investors need tax benefits because companies require financial support from tax advantages. Indonesia lacks the number of angel investors that Singapore and Malaysia do to finance digital enterprises. If investors keep their investment for a minimum of two years, they will receive tax benefits. (17).
H2 Government incentive toward GST among manufacturer is positive in respect to tax compliance
2.4 Motivational Aspiration
Taxation is essential to a nation's economic health. In most emerging economies, tax collection has gotten more difficult. The study suggests that in order to identify tax evasion, the government needs distinguish between taxpayers. These results ought to help the government determine the reasons for discrepancies in tax collection. (18). Taxation is essential to a nation's economic health. In most emerging economies, tax collection has gotten more difficult. The study suggests that to identify tax evasion, the government needs distinguish between taxpayers. These results ought to help the government determine the reasons for discrepancies in tax collection. (19)
H3 Motivational aspiration toward GST among manufacturer is positive in respect to tax compliance
2.5 Behavioral intention
Taxpayer awareness is the readiness to carry out one's tax obligations in good faith and without looking for payment. A taxpayer shows that they are aware of their duties by paying taxes on time and in the correct amount. Taxpayers' lives can be made easier by good tax service providers. By entrusting the tax authorities with the duty of assisting taxpayers, the government has indirectly attempted to promote taxpayer compliance regarding tax-paying duties. Consumer behaviour on taxation is influenced by a variety of factors, including the perceived fairness of the taxation system, the level of taxation, the use of the tax revenues, and the perceived benefits of taxation. Generally, consumers tend to be more accepting of taxation when they perceive the taxation system to be fair, meaning that those with higher incomes pay a higher rate of taxation than those with lower incomes. Additionally, when consumers perceive that the tax revenues are being used to fund programs that benefit them, such as public services and infrastructure, they are more likely to view taxation as a positive. Similarly, when tax revenues are used for programs that provide economic and social benefits to the public, such as poverty relief and education, consumer attitudes towards taxation tend to be more positive. Finally, consumers tend to be more supportive of taxation when they perceive that they are receiving some tangible benefit from the taxes they pay, such as lower prices due to reduced taxation on goods and services.
H4 Behavioral intention toward GST among manufacturer is positive in respect to tax compliance
Based on above hypothesis following structure equation model prepared with help of SPSS and AMOS